Sixty-eighth General Assembly

Fifth Committee

23^rd Meeting (AM)

Fifth Committee Considers Progress Reports on New Office Space

 

at Economic Commission for Africa Headquarters

 

Speakers Call for Accountability,

Decrying Significant Delays, Extra Costs from Construction Mishandling

As the Fifth Committee (Administrative and Budgetary) charted progress made in building new office space at the Economic Commission for Africa (ECA) headquarters in Addis Ababa, delegates voiced serious concern over architectural and contracting mishandling that had significantly delayed its completion and given rise to extra costs.

Originally slated for completion by February 2012, the project’s deadline had since been extended twice.  It was now expected to be finished by the end of December with occupancy starting in January.

Fiji’s representative, speaking for the “Group of 77” developing countries, and China cited the factors behind the delays — errors with architectural and construction management consultants, the import of materials, the processing of bank payments, and coordination by contractors — and expressed concern over the subsequent financial implications for the Organization and its prospective tenants.  He wanted a clear explanation of the steps underway to handle those issues, backing the call by the Advisory Committee on Administrative and Budgetary Questions (ACABQ) for closer monitoring of that and other ancillary projects in order to avoid further delays.

Echoing that sentiment, Côte d’Ivoire’s representative, speaking for the African Group, said the delays could have been prevented, stressing that in December 2010 the General Assembly had asked the Secretary-General to assess the status of ECA’s facilities, particularly Conference Room 1 and the historic Africa Hall, to ensure their strict compliance with the highest conference facility standards.  He lamented that the Secretary-General had not allocated funds for the project in his proposed 2014-2015 budget, and that the Office of Internal Oversight Services (OIOS) had not provided its Assembly-mandated oversight of the project in 2013.

“We would like to remind the Secretary-General of the repeated calls by the General Assembly on the importance of guidance, interaction and coordination between the Secretariat in New York and the Economic Commission for Africa (ECA), as well as the need for full accountability and oversight on this and other construction projects,” he said.

Both representatives, however, commended the use of value engineering at ECA to control costs, stating it should be continually pursued as a best practice in construction and renovation projects.  They encouraged a cautious approach to the flexible use of office space at ECA, taking into account the specific needs, local norms and working culture of each tenant.

Stephen Cutts, Assistant Secretary-General for Central Report Services of the Department of Management, who introduced the Secretary-General’s progress report on the matter, said that notwithstanding the challenges, the ECA project was expected to be finished within the approved budget and scope.  As of 30 November, physical construction of the main building was 92 per cent completed.  The project management team had continued working with all project players to ensure completion as soon as possible.  Moreover, his Office and ECA were coordinating with the Office of Legal Affairs to determine the most appropriate action to make certain that damages absorbed by the Organization due to project delays created by the consultants and contractor were recouped to the fullest extent possible.

Richard Moon, Vice‑Chairman of the Advisory Committee on Administrative and Budgetary Questions, introducing the Advisory Committee’s related report, said ECA should take appropriate action and seek legal redress after the full extent of the prospective claim and related damages was known.  He called for issues of accountability and responsibility regarding the recruitment and supervision of the design consultant to be examined, and urged that recruitment of a qualified, experienced replacement to complete renovation of Africa Hall be expedited.

Janne Taalas ( Finland), Committee Chairman, also made a statement today.

The Committee will meet again at 10 a.m., on Monday, 16 December, to consider the proposed programme budget for the biennium 2014-2015 as it related to special political missions.

Background

The Fifth Committee (Administrative and Budgetary) met today to consider its agenda item on the proposed programme budget for the biennium 2014-2015 as it related to construction and property management of the Economic Commission for Africa (ECA).  Before it was the Secretary-General’s report on Progress in the construction of additional office facilities at the Economic Commission for Africa in Addis Ababa (document A/68/517) and an eponymous report (document A/68/643) of the Advisory Committee on Administrative and Budgetary Questions (ACABQ). 

Opening Remarks

Fifth Committee Chairman JANNE TAALAS ( Finland) thanked everyone for working late the previous evening.  However, the Committee had only five days left to wrap up its work.  He urged delegations to concentrate and engage with each other.  A new programme of work would be coming out, and he advised Committee Members to check it regularly as it was liable to change.  In addition, the President of the General Assembly would join the Committee during its informal meetings this afternoon.

Introduction of Reports

Stephen Cutts, Assistant Secretary-General for Central Report Services, introduced the Secretary-General’s report, which summarizes the last year of progress on constructing additional office facilities for the Economic Commission for Africa in Addis Abba (document A/68/517).  Significant advancements had been made in the physical construction process and as of 30 November, this year, the main building was 92 per cent completed. 

Yet, he noted, the completion and occupancy of the building had been delayed by the contractor’s late delivery of construction materials, combined with an inability to meet the construction schedule.  While 99 per cent of the required materials were on site, he had learned of anticipated further delays.  The project management team continued to work proactively with all project players to make certain the project was completed as soon as possible.

Five tenants had confirmed their intention to occupy the building, he said.  They included the United Nations Office to the African Union, United Nations Children’s Fund (UNICEF), Office of the United Nations High Commissioner for Refugees (UNHCR) Liaison Office to the African Union and ECA, United Nations Office for Project Services (UNOPS) and World Health Organization (WHO).  Even with the challenges facing the construction schedule for the main building and ancillary projects, the project was expected to be completed within the approved budget and scope. 

Value engineering was being used to control costs, he said.  Regarding the project delays created by the consultants and contractor, the Office of Central Support Services and the Commission, working closely with the Office of Legal Affairs, would determine the most appropriate action to ensure that damages absorbed by the Organization would be recouped to the fullest extent possible.  The results would be included in the next Secretariat report.

More work was needed, he said, to modernize Africa Hall’s conference facility to include disability access, exhibition and museum spaces, and to upgrade furniture and conference support installations.  At the end of 2012, the Commission had decided the work of the consultancy firm initially hired to assess the Hall’s premises and develop the renovation plans was unacceptable and did not follow the assignment’s scope.  The Commission planned to use the remaining resources to hire a consultant with expertise to carry out the detailed assessment.

The “tender process” for that consulting work was nearly completed and a contract was to be signed in January 2014, he said.  The information would be included in the Secretariat report delivered to the General Assembly for its sixty-ninth session.  An assessment of the United Nations Conference Centre had been conducted and renovation works were being carried out.  Weatherproofing and emergency repairs of the roof were successfully completed in December 2012.  The resource requirements needed to finance structural safety and security work in the building were included in the proposed programme budget of the 2014-2015 biennium.

RICHARD MOON, Vice‑Chairman of the Advisory Committee on Administrative and Budgetary Questions, introduced the Advisory Committee’s related report (document A/68/517).  He noted the progress in the ECA construction project but regretted the one-year delay in its implementation due to performance issues on the part of the contractor, as well as the related financial implications for the United Nations and prospective United Nations system tenants outside the ECA complex.  ECA should take appropriate action and seek legal redress after the full extent of the prospective claim and the determination of related damages.  He also noted that implementation of the ancillary projects, as well, had been affected by continued delays due mainly to design deficiencies.  Closer monitoring was needed in order to avoid further delays.  Issues of accountability and responsibility for the recruitment and supervision of the design consultant should be examined. 

He commended the project management team’s efforts to contain costs through value engineering.  Such engineering should be pursued continually as a best practice.  Flexible workplace principles should be factored into that and all other major capital projects.  However, there was concern regarding the slow progress in the assessment and design phase of the renovation of the conference facilities, particularly Africa Hall, due to the failure on the part of the initial design consultant.  The Advisory Committee expected every effort would be made to expedite recruitment of a design consultant with the requisite experience and expertise to complete the task.  In addition, the report on the project’s requirements and cost estimates should be submitted to the General Assembly no later than at its sixty-ninth session.  

Statements

LUKE DAUNIVALU (Fiji), speaking for the “Group of 77” developing countries and China, noted the regular changes in the project’s completion date, now set for the end of December with occupancy to begin in January 2014.  The Group welcomed the progress made despite the many challenges and delays since the project’s inception.  He pointed out the factors behind those delays, including errors with architectural and construction management consultants, the import of materials, the processing of bank payments, and coordination by contractors, as well as the subsequent costs.  Concerned with the delays and the subsequent financial implications for the Organization and prospective tenants, he looked forward to receiving clear explanations, during the informal sessions, on measures being taken to handle those issues, including questions on accountability and supervision.

With regard to ancillary projects, he said he agreed with the Advisory Committee on the need for closer monitoring to avoid further delays.  Noting the use of value engineering to control costs, he commended the cost containment efforts of the project management team and stressed that value engineering should be continually pursued as a best practice.  However, a cautious approach should be taken on the use of flexible office space.  The specific needs and policy of each tenant should be taken into account as well as their respective working culture, and local norms and standards and human resource issues.

The slow progress on the renovation of conference facilities at the Commission, particularly the Africa Hall and Conference Room 1 was also of great concern, he said.  The Secretary-General should take serious measures to put the project back on track.  The Group would be seeking clarification regarding the resource requirements for the current biennium and the extent of United Nations Educational, Scientific and Cultural Organization’s (UNESCO) involvement in the project.  He stressed the need for commitment and accountability by senior managers at Headquarters and in the field, and close and consistent oversight on all capital projects.  Further, he expressed concern that the Office of Internal Oversight Services (OIOS) had not provided its annual oversight coverage for this project as mandated by paragraph 16, Part I of resolution 63/263.

BROUZ RALPH ENNERIC COFFI ( Côte d’Ivoire), speaking for the African Group, welcomed the progress thus far in the ECA construction, noting its scheduled completion and occupancy within the next few weeks.  However, there was concern regarding the setbacks that had delayed completion, including problems importing material, logistical challenges, and errors and omissions on the part of the architecture and construction management consultant.  As well, the poor coordination and delays in making payments on the part of the contractor and delays in implementing the ancillary projects due to technical shortcomings were concerning.

He welcomed the information in the reports on value engineering and echoed ACABQ’s call that its application be treated as a best practice rather than a reaction after the fact to project implementation.  In regards to the flexible use of ECA’s office space, he encouraged the Secretary-General to take into account tenants’ specific requirements.  During the informal consultations, the Group would be keen to learn details on that.

Regarding renovation of Africa Hall, he recalled that in resolution 65/259 the General Assembly had asked the Secretary-General to expeditiously assess the status of conference facilities at ECA, in particular Africa Hall and Conference Room 1, to ensure they were in strict compliance with the highest conference facility standards.  However, the unnecessary delays in implementing the project had been due to elements that could have been addressed. 

Further, he continued, the Secretary-General had not provided any allocation for the projects in the current budget proposal.  “We would like to remind the Secretary-General of the repeated calls by the General Assembly on the importance of guidance, interaction and coordination between the Secretariat in New York and ECA, as well as the need for full accountability and oversight on this and other construction projects,” he said.

He also emphasized concerns that OIOS had not fulfilled its oversight responsibilities during the reporting period.  Again, the Secretary-General should take into account lessons learned and best practices in implementing similar capital projects.  The Group would seek clarification on implementing the projects, including the steps taken to address the shortcomings, accountability elements and resource requirements for the current biennia.

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For information media • not an official record